Questions to Ask When Buying a Business (UK)

The questions to ask when buying a business in the UK are the cheapest tool you'll ever use, and the one most buyers fumble. A good question costs you nothing and can save you the price of the whole company. A question you didn't think to ask is how people end up owning a business that loses its biggest customer in month one, or inherits a tax bill the seller forgot to mention.

Here's the backdrop you're buying into. The five-year survival rate for UK businesses born in 2019 was 38.4%, according to ONS Business Demography 2024. Most new businesses don't reach year five. When you buy an established one, part of what you're paying for is that it already survived the danger years. But survival to date tells you nothing about what's coming, and the seller knows things you don't. Questions are how you close that information gap before the money moves, not after.

There's a distinction worth drawing early. You ask the seller different questions than you ask the broker. The seller knows where the bodies are buried and has every reason to keep some of them buried. The broker is paid by the seller, so they're an advocate, not a referee, however friendly they seem. Treat broker answers as the official story and seller answers as the thing you're stress-testing against the paperwork. Neither replaces evidence; a verbal "yes, the lease is fine" is a prompt to read the lease, not a substitute for reading it.

This guide gives you the questions in the order a real deal unfolds: why they're selling, the finances, the customers, the staff and contracts, the lease and assets, the legal skeletons, and the handover. Then the full question list as a table you can take into a meeting, and the red-flag answers that should make you walk. The questions feed directly into your due diligence checklist, where the verbal answers get checked against documents. If you're still at the stage of deciding whether a listing is even worth a meeting, start with how to analyse a business before buying it, then come back here for the conversation itself. Or browse businesses for sale on NewOwner and use this as your script for the first call.

The reason for sale is the single most revealing question you'll ask, because the honest answer is the buyer's edge and the dishonest answer is the seller's tell. Why someone is selling shapes everything: how motivated they'll be on price, whether they'll stay on to help, and whether there's a problem you can't yet see baked into the business.

Start plainly: "Why are you selling?" Then don't accept the first answer. "Retirement" and "new opportunity" are the two stock replies, and both can be perfectly true. They can also be the polite cover for a business in quiet decline, a key contract about to lapse, a health problem, a divorce settlement that needs cash, or a market the owner can see turning before the numbers show it. Your job isn't to be suspicious for the sake of it. It's to find out whether the reason for selling is about the owner's life or about the business's future, because only one of those is your problem.

These follow-ups do the real work:

• How long has it been on the market, and have other buyers walked away? A business that's been for sale for eighteen months has usually had offers that fell through in due diligence. Ask why.
• What would you do differently if you were keeping it? This one disarms people. A seller staying in the game tells you about untapped upside; a seller leaving often tells you, almost with relief, what's been wearing them down.
• Are you selling the whole thing or keeping a hand in? Someone who wants to retain 20% and stay on the board believes in the future. Someone who wants out completely, today, with the cash in full, may know something.
• Where will you go next, and is there a non-compete? If the owner is "retiring" but won't sign a non-compete, ask yourself why they want the option to compete with the business they're telling you has no future.

Of all the questions to ask when buying a business, "why are you selling?" is the one that pays for itself. Ask it three times across three conversations and listen for whether the reason stays the same. A story that drifts is the single most reliable warning sign a seller gives you.

The pattern to watch for isn't a single answer; it's a story that changes. If the reason was retirement on the first call, health on the second, and "new ventures" on the third, the truth is usually the version that makes the business worth less. We come back to this in the red-flag answers at the end. For now, the rule is simple: ask why, ask again differently, and notice whether the answer holds still.

Financial questions are the ones that change the price, so they deserve the most preparation. The goal here is to move past the headline turnover and profit the seller leads with, and get to the real, sustainable earnings you'd actually run the business on. Sellers quote the best version of their numbers. You're asking the questions that turn the best version into the true version.

Begin with the documents, because every later question hangs off them. Ask for three years of full accounts, the last twelve months of management accounts, and twelve months of bank statements for the trading account. For a limited company you can pull the filed accounts, the confirmation statement and any registered charges yourself from Companies House for free before you even ask, then cross-check what's filed against what you're handed. They should reconcile. When they don't, you've found your first real question.

Questions about profit and add-backs when buying a business

Reported profit is rarely the profit you'd inherit. Owner-managers run personal costs through the company and pay themselves to suit their tax position. So the questions that matter are:

• What's in the add-backs? When a seller "adjusts" profit upward to reach a higher EBITDA, ask them to justify every line. An owner's below-market salary is a fair add-back; the family car, the spouse on payroll who never appears, and "one-off" costs that recur every year are not.
• Is the latest year's growth real or dressed for sale? Businesses get groomed before sale. Marketing gets cut, maintenance gets deferred, a big invoice gets pulled forward. Ask what changed in the last twelve to eighteen months and why.
• What's the cash position versus the profit? A business can show profit and still be strangled by working capital. Ask about aged debtors and creditors. Are customers paying in 30 days or 90? Is the company quietly funding itself by stretching its suppliers, a balance that becomes yours the day you complete?

Questions about debt and tax

Debt is where deals quietly turn bad after completion. Ask for every liability in writing: bank loans, asset finance, director's loans, overdrafts, deferred payments to suppliers, and the tax position with HMRC across VAT, PAYE and corporation tax. Ask specifically whether there are any personal guarantees the owner has given that a lender will want re-papering in your name. In a share purchase you inherit these liabilities; in an asset purchase you can often leave most behind. That single distinction can swing the value by tens of thousands, which is why we go deep on it in buying a business with debt and liabilities. Get the HMRC position confirmed with statements where you can, because unpaid tax has a habit of surfacing after completion, and HMRC isn't a creditor you negotiate with the way you might a supplier.

Customer questions test whether the revenue is a stable base or a single relationship wearing a disguise. Concentration is the risk that catches first-time buyers most often: a business can look healthy on every financial measure and still be one phone call away from collapse if too much of it rests on one client who happens to like the departing owner.

The question that catches first-time buyers out: "what share of revenue comes from your biggest customer?" If the answer is north of 30% and the relationship is personal to the seller, you're buying a single phone call, not a business. Ask it before anything else about the customer book.

The first question is the one to insist on: what share of revenue comes from the top one, three and five customers, over the last two or three years? If a single client is 40% of turnover, you aren't buying a business so much as a relationship that happens to have staff attached. And relationships travel with the people who hold them. So the follow-ups matter as much as the headline number:

• How long has each major customer been with the company? A decade-long account is sturdier than one that signed last year, but it can also be one renewal away from a competitive tender.
• Are they on contracts or rolling month to month? A handshake worth 30% of revenue is a handshake you can't bank on. Ask to see the contracts, and check the term and the notice period.
• Is the relationship with the company or personally with you? This is the question sellers least like answering honestly. If the owner golfs with the buyer at the top account and signs every renewal personally, that revenue is at risk the moment they leave, however warm the seller is about "a smooth introduction."
• Has any significant customer been lost in the last two years, and why? A recently departed big account tells you something the current numbers may not yet show.

Then look forward, not just back. Ask whether there's a sales pipeline or whether nothing new has closed in eighteen months. Ask how customers are won: word of mouth that dries up when the founder leaves, or a repeatable channel that runs without them? If the seller will allow it under an NDA, ask to speak to two or three customers directly. Thirty minutes on the phone tells you more about retention than any spreadsheet, and it's the kind of question the financial accounts can't answer. This is exactly the commercial ground we cover in the due diligence checklist; the questions here are how you generate the answers that checklist then verifies.

Questions about people and contracts establish whether the business can keep running once the seller hands over the keys. A company with clean accounts and loyal customers can still fall apart on day one because the things that made it work, the supplier who gives them priority, the manager who runs the floor, the renewal the founder always chased, all walked out the door with the owner.

Questions about staff and TUPE when buying a business

When you buy a business as a going concern, the employees usually come with it, and their rights are protected by law. Under the UK rules covering business transfers and takeovers, employees' jobs transfer to the new owner, their existing terms and conditions transfer with them, and their continuity of service is preserved. You can't quietly trim someone's holiday entitlement or notice period the week after completion, and there's a duty to inform and consult affected staff before the transfer. Getting that consultation wrong is expensive, so it's worth asking early. The questions to ask:

• Give me the full employee list with start dates, salaries, contracted hours and holiday accrued. You need this to know what you're taking on and to model the real payroll cost.
• Are there any outstanding grievances, disciplinary matters or tribunal claims? These transfer to you, and a seller hoping you won't ask is a seller who already knows the answer is awkward.
• Who actually holds the business together, and are they staying? Identify the people whose departure would hurt, then ask what's keeping them and whether their contracts have any notice or retention in place.
• Confirm with your solicitor whether the transfer rules apply to this deal. They usually do for an asset purchase of a trading business, and the cost of assuming wrong lands on the buyer.

Questions about suppliers and contracts

Suppliers and contracts carry their own traps. Ask whether the company depends on a single supplier with no easy alternative, and whether those terms are in writing or a fifteen-year handshake the seller's been relying on. Handshakes don't transfer. Then there's the clause your solicitor cares about most: the change-of-control clause. Plenty of customer and supplier agreements let the other side walk away if the business changes hands. Ask directly whether any material contract has a termination-on-sale clause, and whether the seller has sounded out those counterparties. Buy a business and discover its biggest contract evaporates on completion, and the price you paid was fiction. The questions you ask here become the warranties your solicitor negotiates later, which is why they connect straight into making an offer and negotiating the purchase.

Lease and asset questions check that the place the business runs from, and the kit it runs on, actually come with the deal on terms you can live with. For a high-street business the lease can matter as much as the accounts, because a great business in premises you'll lose, or at a rent about to jump, is a different proposition from the one in the listing.

Start with the lease, where the things that bite are predictable, so ask about each:

• How long is left on the lease, and is there a rent review coming? A ten-year lease at a fixed rent and a two-year lease with a review next quarter are completely different businesses wearing the same shopfront. Ask to see the lease, not just hear about it.
• Does the landlord's consent transfer the lease to me, and how long does that take? An assignment usually needs the landlord's sign-off, and a slow or reluctant landlord can stall completion or, worse, refuse. This is a question to ask before you're emotionally committed.
• What are the repair obligations? A full repairing and insuring lease can hand you a five-figure dilapidations bill at the end of the term. Ask what's been deferred and what the exit cost looks like.

Then the assets. Ask for an inventory of the equipment, fixtures and stock included in the sale, and, this is the part that bites, what's owned outright versus leased or on finance. A van or a piece of machinery on a finance agreement isn't an asset you're buying; it's a liability you may be taking on. Ask the age and condition of the key kit, because equipment that looks fine on a spreadsheet can be held together with tape in person, and anything you'll replace in year one is a cost to negotiate now rather than discover later. Walk the premises if there are any, and ask what isn't included that you'd assume was: the seller's personal laptop with the only copy of the customer database, the domain name registered to a personal email, the software licences tied to the owner's account. What transfers and what doesn't is a question, not an assumption. The answers feed your wider due diligence checklist, where each one gets confirmed against the paperwork.

Legal and reputation questions are how you find the liabilities that don't show up in the profit figure, the lawsuit settling quietly, the regulator's letter in the drawer, the online reputation the seller would rather you didn't search for. These are the questions a seller is least likely to volunteer and most important for you to ask, because in a share purchase you inherit the company's history along with its assets.

Ask the legal questions plainly and get the answers in writing:

• Are there any current, threatened or recent disputes, claims or tribunal cases? Cross-check the answer against the accounts for legal provisions; a "no" that contradicts a provision in the books is a question that just got more interesting.
• Does the company hold every licence, permit and regulatory consent it trades on, and do those transfer to me? A restaurant without a current premises licence isn't a restaurant; it's a room with tables. A care provider, a financial services firm or a licensed trade can lose its right to operate the day the wrong box is unticked.
• Has the company ever been investigated by HMRC, a regulator or a trading standards body? Past investigations have a way of recurring, and they tell you about how the business has been run.
• Who owns the intellectual property, the brand, the domains, the software? It's surprisingly common for the website domain to sit in the founder's personal email or the logo to belong to a freelancer who never assigned copyright. If the brand is why you're buying, this isn't optional.

Then reputation, which costs nothing to check and is too often skipped. Read the reviews on the platforms that matter for the trade. Ask the seller directly about the worst review they've had and how they handled it; the answer tells you about the business and about the person. Search the company name alongside words like "complaint," "refund" and "court." A wall of one-star reviews from the last six months, after years of good ones, is a story the seller may not tell you but the internet will. The point of these questions isn't to assume the worst. It's to make sure that anything the seller can't or won't evidence becomes a warranty or an indemnity in the contract, so an unpleasant surprise after completion is a claim you can make rather than a loss you simply absorb.

Handover questions decide whether you take over a working business or a switched-off one. The gap between those two outcomes is almost entirely about how much of the business lived in the seller's head, and how much of their knowledge and goodwill you can actually transfer before they're gone. This is the part buyers under-negotiate and regret most reliably.

What to ask before buying a business that leans on its owner: "will you stay on for a handover, and will you sign a non-compete?" A seller who says yes to both is confident the business survives them. A seller who refuses both is telling you it doesn't, or that they plan to take the customers with them.

The blunt opening question: what happens the morning you stop answering the phone? If the seller is the chief salesperson, the head of operations, the keeper of every supplier password and the only person the long-standing customers will speak to, you aren't buying a business so much as a job that depends on someone who's leaving. The questions that protect you:

• Will you stay on through a handover, for how long, and on what terms? A seller willing to stay three to six months, paid and committed, is worth a great deal. One who wants to hand over the keys and be gone next Friday is either confident the business runs itself, which you should verify, or keen to be elsewhere when problems surface.
• Will you introduce me personally to the key customers and suppliers? A warm, in-person handover of the relationships you identified as concentrated is the difference between keeping that revenue and watching it drift. Build the introductions into the deal, with timing.
• Will you sign a non-compete, and how wide is it? A seller who won't agree not to set up next door and poach the customers is telling you what they intend to do. Geography and duration matter; get your solicitor to make it enforceable.
• What's documented and what's only in your head? Ask for the operating procedures, the supplier list, the passwords, the customer database in a form that transfers. "It's all up here" is a transition risk you price into the deal or solve before completion.

The best handovers are written into the purchase agreement, not left to goodwill, because goodwill evaporates once the money's paid and the seller has moved on. A retention or an earn-out, where part of the price depends on the business performing after you take over, can align everyone: the seller has a reason to make the handover work, and you're not paying in full for performance you haven't seen yet. That's a negotiating lever as much as a transition tool, and we cover how to structure it in making an offer and negotiating the purchase.

Here's the working list to take into your meetings. For each question, I've put what a good answer sounds like next to the red flag that should make you slow down and dig. This is the set of questions to ask when buying a business that I'd hand a first-time buyer; trim the depth to the size of the deal, but don't drop the categories. Treat every verbal answer as a prompt to see the document, not as the document itself.

Question to ask	What a good answer looks like	Red flag
Why are you selling?	A clear life reason (retirement, relocation) that holds steady across conversations	A story that changes, or a vague "new opportunities" with no detail
How long has it been for sale and have buyers walked?	On the market briefly, or honest about a prior deal and why	Eighteen months listed, several collapsed deals, no clear reason
Can I see 3 years' accounts plus 12 months' management figures?	Provided promptly and they reconcile to the bank	Delays, "next week," or figures that don't match the filings
What's in the profit add-backs?	Defensible items like a below-market owner salary	Recurring "one-off" costs and personal expenses inflating EBITDA
What debt and tax does the business carry?	Full written list, HMRC position confirmed by statement	Undisclosed loans, deferred VAT, or a personal guarantee surfacing late
What share of revenue is the top customer?	Spread across many accounts, none dominant	One client above ~30%, on a handshake, tied to the owner
Are the major customers on contracts?	Written contracts with reasonable notice periods	Rolling, verbal, or with change-of-control termination clauses
Who are the key staff and are they staying?	Named, stable, contracts in place, willing to stay	Reliance on one person who's leaving, undisclosed grievances
How long is left on the lease and is a review due?	Long term, fixed or predictable rent, assignable	Short term, imminent review, landlord consent uncertain
What's owned outright versus on finance?	Clean inventory, key assets owned	Core equipment on finance, treated as an asset in the price
Any current or threatened legal disputes?	None, and it matches the accounts	A claim, or a "no" that contradicts a provision in the books
Who owns the brand, domains and software?	The company owns all of it, in writing	IP sitting in the founder's personal name or accounts
Will you stay on for a handover and sign a non-compete?	Yes, several months, enforceable non-compete	Wants out immediately, refuses to limit competing
What's documented versus in your head?	Written procedures, transferable systems	"It's all up here," no documentation

Work down the list, note which answers come with evidence and which come with a shrug, and the gaps become your negotiation list. The questions are step one; checking the answers against documents is step two, and that's the business due diligence checklist.

Some answers are negotiating points; a few are reasons to walk. Knowing the difference is most of the skill of buying well. A red-flag answer rarely means "never buy" on its own. It means "stop, get this in writing, and don't take another step until it's explained and evidenced." These are the answers that have ended deals, and rightly so.

• The reason for selling keeps changing. Retirement on Monday, health on Wednesday, "new ventures" by Friday. When the narrative shifts under questioning, the version that makes the business worth less is usually the true one. A seller who can't give you a steady reason is hiding something or doesn't trust you yet, and neither is a footing to commit on.
• "Trust me, it's all there." A seller who won't evidence the key customer's contract, the HMRC position, or twelve months of bank statements is telling you to assume the worst. Real businesses can produce their paperwork. A refusal to is itself the finding.
• The accounts don't match the bank. If declared turnover and the money actually landing in the account are more than a few percent apart with no clean explanation, stop. Either the figures are wrong or someone's massaging them, and you can't value a business on numbers you don't believe.
• One customer is 40% of revenue and won't deal with anyone but the owner. This is the classic post-completion collapse. Either get that relationship contracted and transferred before you sign, or treat the revenue as at risk and price it that way.
• Undisclosed debt or tax arrears appear mid-process. Finding a director's loan or a deferred VAT balance the seller "forgot" tells you two things: there's debt, and the seller isn't straight. The second is worse. While you're at it, check the filing history yourself: miss a confirmation statement and a company can be fined up to £5,000 and struck off the register, and a messy filing record is a tell about how the whole business is run.
• The seller refuses any handover or non-compete. Someone unwilling to stay even briefly, or to agree not to compete, is either hiding how dependent the business is on them or planning to take the customers with them. Either way, you're being warned.

None of these kills a deal automatically. Each one means you pause, get the answer in writing, and either solve it in the contract through price, warranties or indemnities, or you walk. The buyers who get burned are almost always the ones who heard the wrong answer, felt the sunk cost of weeks of work, and pressed on anyway.

Asking the right questions when buying a business in the UK is what turns a leap of faith into an informed decision. Good questions protect you from a bad deal, and they hand you the bargaining power to make a fair one, because when you can point to the answer that didn't add up, you negotiate from evidence instead of hope. Ready to put the list to work? Browse businesses for sale on NewOwner and use these questions on the first one worth a call.